Gold clawed higher on Thursday on European Central Bank President Mario Draghi's bullish European economy comments, which followed President Donald Trump's dollar-weakening deal with opposition Democrats to extend the U.S. debt limit temporarily.
Spot gold was up 0.51 percent at $1,340.61 per ounce at 9:13 a.m. ET, after easing 0.3 percent in the previous session. U.S. gold futures for December delivery rose 0.53 percent to $1,346.10.
In his remarks at a news conference on Thursday, Draghi acknowledged that core inflation in the region was creeping up, sending the common currency higher. But he expressed confidence that the ECB's inflation aims will be met, and that the bank's outlooks for growth and inflation are largely unchanged.
The ECB also raised its 2017 GDP outlook.
The euro held most of its gains, continuing pressure on the dollar, after the ECB reaffirmed its ultra-easy policy stance on Thursday, even keeping the door open to increasing bond purchases.
On Wednesday, Trump forged a surprising deal to provide government funding until Dec. 15, averting a crisis over the debt ceiling.
Gold initially fell in response, but found support on Thursday as investors digested the implications of the deal.
Gold
Gold clawed higher on Thursday on European Central Bank President Mario Draghi's bullish European economy comments, which followed President Donald Trump's dollar-weakening deal with opposition Democrats to extend the U.S. debt limit temporarily.
Spot gold was up 0.51 percent at $1,340.61 per ounce at 9:13 a.m. ET, after easing 0.3 percent in the previous session. U.S. gold futures for December delivery rose 0.53 percent to $1,346.10.
In his remarks at a news conference on Thursday, Draghi acknowledged that core inflation in the region was creeping up, sending the common currency higher. But he expressed confidence that the ECB's inflation aims will be met, and that the bank's outlooks for growth and inflation are largely unchanged.
The ECB also raised its 2017 GDP outlook.
The euro held most of its gains, continuing pressure on the dollar, after the ECB reaffirmed its ultra-easy policy stance on Thursday, even keeping the door open to increasing bond purchases.
On Wednesday, Trump forged a surprising deal to provide government funding until Dec. 15, averting a crisis over the debt ceiling.
Gold initially fell in response, but found support on Thursday as investors digested the implications of the deal.
Gold can counteract equity volatility, says analyst
Gold can counteract equity volatility, CIO says
"We see that strangely playing out in the dollar," said Jonathan Butler, commodities analyst at Mitsubishi in London.
Fears of a debt default had boosted the dollar and treasury yields through safe-haven buying, but once that concern was lifted, those flows reversed, Butler said.
"Now that we've seen a kicking into long grass of the debt ceiling issue, we've actually seen the dollar being sold off, and that's given some support to gold today."
The dollar index fell as low as 91.766, the weakest since Aug. 29.
Continuing tensions with North Korea over its nuclear tests provided further support for safe-haven gold.
"The odds of geopolitical tensions escalating further are very high. If North Korea does another missile test, it will trigger risk-off trade and the yellow metal could benefit," said Naeem Aslam, chief market analyst, Think Markets.
China said on Thursday it agreed the United Nations should take more action against North Korea after its latest nuclear test, while pushing for more dialogue to resolve the crisis on the Korean peninsula.
Next
« Prev Post
« Prev Post
Previous
Next Post »
Next Post »
Subscribe to:
Post Comments (Atom)
ConversionConversion EmoticonEmoticon